[Senate Report 107-298]
[From the U.S. Government Publishing Office]
Calendar No. 635
107th Congress Report
SENATE
2d Session 107-298
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PROVIDING FOR THE USE AND DISTRIBUTION OF CERTAIN FUNDS AWARDED TO THE
GILA RIVER PIMA-MARICOPA INDIAN COMMUNITY, AND FOR OTHER PURPOSES
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October 4, 2002.--Ordered to be printed
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Mr. Inouye, from the Committee on Indian Affairs, submitted the
following
R E P O R T
[To accompany S. 2799]
The Committee on Indian Affairs, to which was referred the
bill (S. 2799) to provide for the use and distribution of
certain funds awarded to the Gila River Pima-Maricopa Indian
Community, and for other purposes, having considered the same,
reports favorably thereon with an amendment and recommends that
the bill (as amended) do pass.
PURPOSE
The purpose of S. 2799 is to authorize the Gila River
Indian Community to distribute a $7 million judgment award to
eligible Community members as required by the Indian Tribal
Judgment Funds Use or Distribution Act and to waive the
repayment of expert assistance loans made by the Department of
the Interior to the Community.
BACKGROUND AND NEED
In 1951, the Gila River Indian Community filed a complaint
before the Indian Claims Commission asserting a claim for the
failure of the United States to protect the Community's use of
water from the Gila and Salt Rivers. In 1972 and 1982, the
Indian Claims Commission and U.S. Court of Claims found the
United States liable to the Community regarding the claims made
in the final two dockets of the litigation, Dockets 236-C and
236-D, respectively. In 1999, the Community agreed to a
monetary settlement in the amount of $7 million. Final judgment
was entered against the United States in that amount, and the
Department of Treasury certified the payment of $7 million,
less attorneys fees, to be deposited in a trust account on
behalf of the Community, which is currently being managed by
the Office of Trust Funds Management at the Department of
Interior.
S. 2799 is the final step in resolving litigation that
began in 1951 and this legislation represents the product of
close consultation between the Community and the Bureau of
Indian Affairs regarding the structure and content of the
distribution plan. The per capita distribution authorized in S.
2799 would result in a distribution of approximately $400 per
eligible tribal member. The Community has experienced delays in
finalizing the enrollment data and establishing the
distribution plan set forth in the bill. Passage of S. 2799 has
become one of the Community's highest priorities.
LEGISLATIVE HISTORY
S. 2799 was introduced on July 25, 2002 by Senator McCain
and was referred to the Committee on Indian Affairs.
SECTION-BY-SECTION ANALYSIS
Sec. 1. Short Title; Table of Contents. The short title of
S. 2799 is the ``Gila River Indian Community Judgment Fund
Distribution Act of 2002''. The bill is divided into three
titles preceded by a findings and definition section.
Sec. 2. Findings. There are 8 separate findings in the
bill. These findings recite the history of the water claims
brought by the Gila River Pima-Maricopa Indian Community
against the United States on August 8, 1951 before the Indian
Claims Commission in Gila River Pima-Maricopa Indian Community
v. United States. These findings also describe the history of
the claim, the establishment of liability against the United
States on claims 236-C (1972) and 236-D (1982), the Community's
settlement of dockets number 236-C and 236-D for a total of
$7,000,000 (April 27, 1999), the entry of a final judgment of
$7,000,000 against the United States (May 3, 1999), and the
certification of $7,000,000 payment, less attorney fees, and
establishment of a trust account for the Community managed by
the Department of Interior (October 6, 1999). The findings
conclude by reciting that the Secretary is required to submit a
use and distribution plan to Congress for approval before funds
can be distributed to individual Indians.
Sec. 3. Definitions. The bill defines ``adult'',
``community'', ``Community owned funds'', ``IIM account'',
``judgment funds'', ``legally incompetent individual'',
``minor'', ``payment roll'', and ``Secretary''.
The definition of ``Community-owned funds'' has been
amended and narrowed by the Committee from the original version
of the bill as introduced to include revenues held by the
Community that are derived from trust resources and which
qualify for an exemption under section 7 or 8 of the Indian
Tribal Judgment Funds Use or Distribution Act (25 U.S.C. 1407,
1408). These ``Community-owned funds'' are the basis for per
capital payments under the Act to adults and for transfer in
trust to the Secretary for minors, deceased beneficiaries and
incompetent individuals who are eligible for payment but who
have not been listed on the final roll.
The Department of the Interior raised concerns about the
former definition of ``Community-owned funds'' because it
included revenues derived from ``Community-owned enterprises''
which potentially could have included revenuesderived by the
Community from taxable gaming activities. The Department was concerned
that under the terms of S. 2799 the Secretary is required to hold these
gaming revenues in a tax exempt trust account which later was to be
paid to individual Indians on a per capita basis. The Department was
also concerned that the mixing of exempt and non-exempt funds could
change the status of these per capita funds from exempt to non-exempt,
thus making them taxable to the recipient. The Committee intends to
make clear that these funds are eligible to be exempt from taxation by
amending and narrowing the definition of ``community owned funds'' to
include only those funds derived from sources already exempt from
taxation.
TITLE I--GILA RIVER JUDGMENT FUND DISTRIBUTION
Section 101: Distribution of judgment funds
(a) Per Capita Payments. Section (a) authorizes the
distribution of the judgment fund amount, less attorneys fees
and litigation expenses, including all accrued interest, to all
eligible enrolled members of the Community on a per capita
basis.
(b) Preparation of Payment Roll. Requires the Community to
prepare the payment roll of eligible enrolled members according
to specific criteria, and includes a description of individuals
who shall be deemed ineligible to receive per capita payments.
(c) Notice to the Secretary. Requires the Community to
notify the Secretary of Interior of the total number of
individuals eligible to share in the per capita distribution
after the Community's preparation of the payment roll, and
requires that such data be broken down into subdivisions
reflecting the number of individuals falling within the
following categories: eligible adult members, decreased
individuals, legally incompetent individuals, and minors.
(d) Information Provided to the Secretary. Requires the
Community to provide the Secretary of Interior with information
necessary to allow the Secretary to establish estate accounts
for deceased individuals and Individual Indian Money (IIM)
accounts for legally incompetent individuals and minors.
(e) Disbursement of Funds. Requires the Secretary to
disburse to the Community those funds necessary to make the per
capita payments, not later than 30 days after the payment roll
has been approved by the Community and the Community has
reconciled the number of shares that belong in each payment
category. Provides that once the funds are disbursed to the
Community, the Community shall be responsible for administering
and distributing the funds.
(f) Shares of Deceased Individuals. Requires the Secretary
of Interior to distribute per capita shares of deceased
individuals to their heirs and legatees in accordance with
existing regulations. Where there are no heirs, provides that
funds revert to the Community and shall be deposited in the
Community's general fund.
(g) Shares of Legally Incompetent Individuals. Requires the
Secretary of Interior to deposit shares of legally incompetent
individuals into supervised IIM accounts to be administered
pursuant to existing regulations.
(h) Shares of Minors. Requires the Secretary of Interior to
deposit shares of minors into supervised IIM accounts and
requires the Secretary to hold these funds in trust until the
minor attains the age of 18 years. Provides that section
3(b)(3) of the Indian Tribal Judgment Funds Distribution Act
does not apply, the effect of which is to prevent parents and
guardians of minors from being able to receive any judgment
funds on behalf of minors before they reach the age of 18
years.
(i) Payment of Eligible Individuals Not Listed on Payment
Roll. Provides that individuals not listed on the payment roll
but eligible for payment may be paid from any residual
principal or interest fund remaining after the Community has
made its per capita distribution and established its trust
accounts. If insufficient judgment funds remain to cover the
cost of payments, the Community is authorized to use Community-
owned funds as defined by section 3(3) of the bill to make
these payments. In the case of minors, legally incompetent
individuals, and deceased individuals, the Secretary of
Interior is authorized to accept and deposit Community-owned
funds into an IIM or estate account established for a minor,
legal incompetent or deceased beneficiary eligible to receive
payment but not listed on the payment roll. Provides that the
Secretary shall invest these trust funds pursuant to existing
law.
As indicated in the discussion under Section 3
``definitions'', the Committee has amended the definition of
``Community-owned funds'' under section 3(3)(B) so that
payments under this section may only be made by the Community
with funds derived from trust resources which qualify for tax
exempt status under 25 U.S.C. Sec. Sec. 1407 and 1408.
(j) Use of Residual Funds. Allows for the transfer of
residual funds from the Department of Interior to the general
fund of the Community if the governing body of the Community
makes such a request of the Secretary and adopts a tribal
council resolution reaffirming its desire to have these
residual funds transferred. The bill as introduced was amended
to require the Community council to enact a tribal resolution
manifesting its intention to have these residual funds
transferred into the general fund of the Community.
(k) Reversion of Per Capita Shares to Tribal Ownership.
Enables the transfer of funds held in trust and the interest
accrued thereon by the Secretary to the Community if the per
capita share is unclaimed for a minimum period of 6 years. A
new section was added to clarify that a minimum of six years
must pass before the Community may request that these unclaimed
funds be transferred into the general fund of the Community.
Section (k) ``Non-applicability of Certain Law'' was
deleted because that section was rendered superfluous by the
changes adopted to the definition of ``Community-owned funds''
under section 3(3)(b).
Sec. 102. Responsibility of Secretary; applicable law
(a) Responsibility for Funds. Provides that after
disbursement of funds by the Community to eligible adult living
members as provided under section 101(e)(1), the Secretary
shall no longer have trust responsibility for those judgment
funds.
(b) Deceased and Legally Incompetent Individuals. Provides
that Secretary shall continue to have a trust responsibility
for funds retained in accounts for deceased beneficiaries and
legally incompetent individuals until the date on which those
funds are disbursed under the Act.
(c) Applicability of other Law. Provides that pursuant to
sections 7 and 8 of the Indian Tribal Judgment Funds Use or
Distribution Act, that all funds distributed under the Act,
including all interest and investment income thereon, shall be
considered tax-exempt income to individual recipients.
TITLE II--CONDITIONS RELATING TO COMMUNITY JUDGMENT FUND PLANS
Section 201. Amendment to plan for use and distribution of judgment
funds awarded in Docket 228
(a) Definition of Plan. ``Plan'' means the plan for the use
and distribution of judgment funds awarded to the Community in
Docket No. 228 as modified by Public Law 99-493 (100
Stat.1241).
(b) Conditions. Adds conditions providing that section
3(b)(3) of the Indian Tribal Judgment Funds Use and
Distribution Act shall not apply to minors' per capita shares
held by the Secretary under the plan (effect is to prevent
shares from being distributed to parents and guardians of
minors prior to age 18), mandates the Secretary hold the
minors' per capital shares in trust until age 18 is attained by
the minor, mandates the Secretary not disburse judgment funds
or interest earned until the age 18 years is attained by the
minor, and mandates that upon the Community's request, any
residual principal and interest funds remaining after the
Community has declared the per capita payments have been
completed shall be distributed to the Community and deposited
into the Community's general fund.
Section 202. Plan for use and distribution of judgment funds awarded in
Docket 236-N
(a) Definition of Plan. ``Plan'' means the plan for the use
and distribution of judgment funds awarded to the Community in
Docket No. 236-N of the United States Court of Federal Claims
(59 Fed. Reg. 31092 (June 16, 1994)).
(b) Conditions. Adds conditions to require amendments to
the plan to authorize disbursement of residual principal and
interest to the Community. Adds further conditions providing
that the provisions of the Indian Tribal Judgment Funds Act
permitting payment to parents and legal guardians of minors
shall notbe applicable, and requires the Secretary to hold
these minors' shares in trust until these minors attain the age of 18
years.
TITLE III--EXPERT ASSISTANCE LOANS
Section 301. Waives repayment by the Gila River Indian
Community of expert assistance loans made by the Department of
Interior to the Community. This section of S. 2799 was amended
to remove provisions pertaining to waivers of repayment for two
other tribes in order to have the terms of S. 2799 pertain only
to the Gila River Indian Community.
COMMITTEE RECOMMENDATION AND TABULATION OF VOTE
The Committee on Indian Affairs, in an open business
session on October 1, 2002, ordered S. 2799 as amended, to be
reported favorably to the Senate.
COST AND BUDGETARY CONSIDERATIONS
At the time of filing this report, the cost estimate of the
Congressional Budget Office on S. 2799 has not yet been
received. Compliance with Senate Rule XXVI, paragraph 11(a) is
therefore impracticable at this time.
EXECUTIVE COMMUNICATIONS
The position of the Administration on S. 2799 has not been
received.
REGULATORY AND PAPERWORK IMPACT
Paragraph 11(b) of rule XXVI of the Standing Rules of the
Senate requires each report accompanying a bill to evaluate the
regulatory and paperwork impact that would be incurred in
implementing the bill. The Committee finds that S. 2799 will
not require the promulgation of regulations so the regulatory
and paperwork impact should be minimal.
CHANGES IN EXISTING LAW
In compliance with subsection 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by a
bill are required to be set forth in the accompanying committee
report. S. 2799 effects no changes in existing law.